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publication August 31, 2020

Developing Nature-Based Tourism as a Strategic Sector for Green Growth in Lao PDR

Key Findings

Lao PDR is a country of stunning natural landscapes including spectacular limestone mountains, rainforests and waterfalls. Its lush nature and rich culture offer an opportunity to develop nature-based tourism, which can generate revenue, create green jobs and livelihood opportunities, and lay the groundwork for greener economic growth.

Lao PDR’s comparative advantage is its natural wealth

  • In the next decade, nature-based tourism could grow in Laos from 4.3% of 2019 GDP and 3.5% of jobs to the global average of about 10% of GDP and 10% of jobs.
  • This opportunity is based on developing quality nature-based tourism products that respond to international demand, and policies that enable responsible private investment and effective conservation.

Protected areas and biodiversity are an economic asset

  • The wet evergreen forests, karst landscapes, and montane forest of Laos are home to internationally significant biodiversity.
  • Fifteen percent of the country’s land area is set aside for biodiversity conservation in 23 national reserves. An additional 5 percent is in provincial or local reserves.
  • Over 840,000 people in over 1200 villages are situated within or on the boundary of the 23 national reserves. Most of these villagers, from a range of ethnic groups, are dependent upon natural resources within these reserves for nutrition and livelihoods.

Tourism can create green jobs, a green recovery, and green growth

  • Tourism has the potential to become the main foreign exchange earner, and nature-based tourism could eventually be the biggest rural employer in the country.
  • Nature-based tourism development can lead to significant increases in overall income and poverty reduction in communities near or in protected areas. In one village near Dong Hau Sao National Protected Area, poverty fell from 39% to 26% due to a Lao nature-based tourism business that partnered with the community.
  • Lao PDR can tap into a growing regional market. In 2018, tourism to Asia grew by 8%, and inter-Asian tourism grew by 10%. The Chinese, Thai, Vietnamese, and Malaysian markets have good potential for nature-based tourism in Lao PDR.

Nature-based tourism in Lao PDR has been hindered by low private investment and low public investment in natural attractions.

  • Barriers to investment include a lack of basic services, weak legal frameworks and transparency, weak management and financing of protected areas, institutional capacity, and tourism products that do not always respond to demand.
  • Investment in tourism is unlikely to increase unless the business environment is simplified.


Enable private investment in nature-based tourism by reducing barriers, streamlining regulations, and promoting innovation.

  • Reduce barriers related to business investment overall, and particularly tourism businesses
  • Establish regulations and procedures for tourism concessions in protected areas and other natural landscapes, with a focus on creating best practice concessions that support wildlife protection and village partnerships.
  • Support marketing and promotion of a national nature-based tourism brand, while encouraging foreign investment and improving links between domestic and international businesses.
  • Develop environmental impact assessment regulations tailored for the small businesses that underpin the Lao tourism industry.
  • Encourage voluntary sustainability practices in the private sector through solutions like international certification.
  • Provide vocational training on nature-based tourism innovation, market development, and hospitality, including training for local guides and accommodation providers.

Manage protected areas for sustainable tourism.

  • Finalize master plans for national protected areas, nature-based tourism and ecotourism
  • Enhance the skills of departments that manage protected areas, in particular concession management for tourism services
  • Create tourism working groups for protected areas.
  • Manage waste in nature-based tourism areas.
  • Establish a transparent system for fees and use of revenues in and around protected areas, as well as an investment protection mechanism.
  • Support financing of last mile tourism infrastructure and facilities in and around protected areas such as trails and other green infrastructure that can employ people.